Contract Administration - Level 1

Question 1

What standard forms of contract are you aware of?

Answer 1

Common standard forms include JCT, NEC, and FIDIC.

Question 2

What are the timescales involved with an extension of time request on a standard JCT contract?

Answer 2

Typically, the contractor must notify the CA within 14 days of the event causing delay.

Question 3

Does an instruction need to have an agreed value contained within it?

Answer 3

No, an instruction does not need to have an agreed value.

Question 4

The contractor fails to complete the project by the completion date, what measures do the CA/EA take and what are the consequences of this?

Answer 4

The CA/EA may issue a non-completion certificate, which can lead to penalties for the contractor.

Question 5

The CA/EA fails to issue a non-completion certificate on an over running project, what are the consequences of this?

Answer 5

The contractor may not face penalties or liquidated damages if no certificate is issued.

Question 6

What is your understanding of bespoke contract?

Answer 6

A bespoke contract is tailored specifically to the needs of the project and parties involved.

Question 7

What do you understand as the difference between a bespoke contract and standard form of contract?

Answer 7

Bespoke contracts are customized, while standard forms are pre-drafted and widely used.

Question 8

What are your views on the advantages/disadvantages of using a bespoke contract?

Answer 8

Advantages include flexibility and specificity; disadvantages may include complexity and higher costs.

Question 9

What are your views on the advantages/disadvantages of using a standard form of contract?

Answer 9

Advantages include familiarity and efficiency; disadvantages may include lack of customization.

Question 10

When was the JCT contract suite last updated?

Answer 10

The JCT contract suite was last updated in 2016.

Question 11

Tell me about some of the key changes that were made.

Answer 11

Key changes included updates to reflect legal and industry practices.

Question 12

How was the JCT contract suite modernised through the last update?

Answer 12

The suite was modernised by incorporating clearer language and electronic processes.

Question 13

How does JCT facilitate electronic working?

Answer 13

JCT provides templates and guidelines for electronic document management.

Question 14

How does the JCT work alongside the Construction Playbook?

Answer 14

JCT aligns with the Construction Playbook by promoting best practices in procurement.

Question 15

How has the JCT contract suite incorporated diversity and inclusion?

Answer 15

The suite includes provisions to promote diversity and inclusion in procurement processes.

Question 16

What is the JCT Fluctuations Hub used for?

Answer 16

The JCT Fluctuations Hub is used to manage price fluctuations in contracts.

Question 17

Explain the JCT Target Cost Contract to me.

Answer 17

The JCT Target Cost Contract is designed to incentivize cost control and collaboration.

Question 18

What form of NEC contract might the Target Cost Contract be a good alternative for?

Answer 18

The Target Cost Contract might be a good alternative for the NEC form of contract.

Question 19

What are the qualities of the NEC form of contract?

Answer 19

The NEC form of contract is known for flexibility, clarity, and a focus on collaboration.

Question 20

What are the advantages of the JCT form of contract?

Answer 20

The JCT form of contract offers clarity, familiarity, and a well-established framework.

Question 21

What changes were last made to the NEC form of contract?

Answer 21

The last changes to the NEC form of contract included updates for clarity and efficiency.

Question 22

When were these changes made?

Answer 22

These changes were made in 2021.

Question 23

What is the difference between a Relevant Event and Relevant Matter?

Answer 23

A Relevant Event relates to delays caused by external factors, while a Relevant Matter pertains to issues affecting the contractor’s performance.

Question 24

If a non-completion certificate is not issued, what is the contractual effect?

Answer 24

If a non-completion certificate is not issued, the contractor may not be penalized for delays.

Question 25

What guidance is there on contract administration?

Answer 25

Guidance on contract administration includes best practices for managing contracts and ensuring compliance.

Question 26

What are the duties of a CA under JCT contracts?

Answer 26

The duties of a CA under JCT contracts include overseeing contract compliance and managing communications.

Question 27

Do these duties include design?

Answer 27

No, the duties of a CA under JCT contracts do not typically include design responsibilities.

Question 28

When authorising payment for goods or materials stored off site what must you obtain to protect your client in the event of the contractor going bankrupt?

Answer 28

You must obtain a legal charge or lien to protect your client.

Question 29

If you are concerned that a contractor is in financial difficulties, name 3 things as CA you should do?

Answer 29

You should review the contractor's financial status, communicate concerns to the client, and consider withholding payments.

Question 30

What key function does a contract administrator perform on a construction project?

Answer 30

A contract administrator manages the contract and ensures compliance with its terms.

Question 31

Can you name three standard forms of contracts that can be used on a construction project?

Answer 31

Three standard forms of contracts are JCT, NEC, and FIDIC.

Question 32

What insurance provisions are in the JCT and NEC standard forms of contract?

Answer 32

Both JCT and NEC contracts include provisions for public liability and employer's liability insurance.

Question 33

What is loss insurance?

Answer 33

Loss insurance covers financial losses due to unforeseen events.

Question 34

What is all risks insurance?

Answer 34

All risks insurance provides coverage for a wide range of potential damages and losses.

Question 35

Where is the minimum financial cover for the contractor’s liability for injury, death and damages to property other than the works contained?

Answer 35

The minimum financial cover is typically contained within the contract documents.

Question 36

What is a contractor’s all risk insurance or contract works insurance?

Answer 36

Contractor’s all risk insurance covers damage to the works and materials during construction.

Question 37

What do you understand by insurance in joint names?

Answer 37

Insurance in joint names means that both the contractor and client are covered under the same policy.

Question 38

What is a collateral warranty?

Answer 38

A collateral warranty is a contract that provides additional assurance to third parties.

Question 39

What are the three ways that benefits can be transferred under JCT contracts?

Answer 39

Benefits can be transferred through assignment, novation, or collateral warranties.

Question 40

Who might want a collateral warranty?

Answer 40

Clients, lenders, and other stakeholders may want a collateral warranty.

Question 41

How are they requested?

Answer 41

Collateral warranties are typically requested in writing during contract negotiations.

Question 42

What are the common clauses / terms in collateral warranties?

Answer 42

Common clauses include liability limits, duration, and rights of third parties.

Question 43

What is the difference between a bond and a collateral warranty?

Answer 43

A bond is a financial guarantee, while a collateral warranty provides assurance of performance.

Question 44

Are there any alternatives to collateral warranties?

Answer 44

Alternatives to collateral warranties include letters of intent and performance bonds.

Question 45

What is your understanding of what a letter of intent is?

Answer 45

A letter of intent is a preliminary agreement outlining the intention to enter into a contract.

Question 46

What are the advantages of a letter of intent?

Answer 46

Advantages include establishing commitment and allowing work to commence before the contract is finalized.

Question 47

What are the disadvantages?

Answer 47

Disadvantages include potential legal ambiguity and lack of formal obligations.

Question 48

In what circumstances might they be used?

Answer 48

Letters of intent might be used in urgent projects or when negotiations are ongoing.

Question 49

What is their purpose?

Answer 49

The purpose is to signal intent and facilitate early project commencement.

Question 50

Who issues it?

Answer 50

The client typically issues the letter of intent.

Question 51

Who signs it?

Answer 51

The client and contractor sign the letter of intent.

Question 52

What would you say if the client asked you to draft a letter of intent?

Answer 52

I would advise on the implications and ensure it clearly outlines the terms.

Question 53

What is the final account (FA)?

Answer 53

The final account is a statement of the total costs incurred in a project.

Question 54

What must the FA state?

Answer 54

The FA must state the final costs, adjustments, and any outstanding claims.

Question 55

Who prepares the final account in a JCT form of contract?

Answer 55

The contractor prepares the final account in a JCT form of contract.

Question 56

Who prepares the final account in the NEC4 form of contract?

Answer 56

The project manager prepares the final account in the NEC4 form of contract.

Question 57

What is the purpose of a final account?

Answer 57

The purpose of a final account is to settle all financial matters related to the contract.

Question 58

On the issue of the final account, what are the relevant time periods in a JCT form of contract?

Answer 58

The relevant time periods include submission deadlines and review periods.

Question 59

When must the final certificate be issued?

Answer 59

The final certificate must be issued within a specified period after the final account is agreed.

Question 60

Tell me two of the information or statements that must be contained in the final certificate.

Answer 60

The final certificate must contain the total amount due and confirmation of completion.

Question 61

What are the usual constituents of a final account?

Answer 61

The usual constituents include a breakdown of costs, variations, and any claims.